Key Points
- FTSE 100 closing price of 7,032.90, -0.15%
- UK shares steady as restrictions eased
- Cryptocurrencies fall on Musk doubts
- FX markets quiet
- Oil futures higher
By Samuel Indyk
Investing.com – The FTSE 100 was relatively steady on Monday, trading above 7,000 as the UK takes the next steps in reopening the economy. From Monday, pubs and restaurants can open inside, international travel is no longer illegal, and cinemas and sports stadia can reopen.
However, a number of companies in these sectors have had a torrid day as doubts creep in over the final easing of restrictions due to the B.1.617.2 coronavirus variant, often referred to as the Indian variant.
On Friday, Prime Minister Johnson said the variant could pose “serious disruption” to the final easing of restrictions but his spokesperson today said no decision has been made yet on reopening.
Nevertheless, airlines were weak and jet engine manufacturer Rolls-Royce (LON:RR) fell by around 4% as increasing spread of the virus could dent international travel plans.
GBP was relatively untroubled by the noise around Covid and there is hope that the vaccinations are effective at combating the latest strain to land on these shores. GBP/USD was trading marginally higher, reclaiming the 1.4100 handle after opening below there late on Sunday. EUR/USD was relatively flat around 1.2150.
Cryptocurrencies were much more volatile. The price of Bitcoin fell to its lowest since February 9th in early trade before finding some support after Elon Musk tweeted that Tesla had not sold any of its Bitcoin holdings. The news came as Musk sent Bitcoin and other cryptocurrencies lower with a series of tweets over the weekend, after last week Tesla (NASDAQ:TSLA) announced they would not be accepting Bitcoin as payment for vehicles due to its environmental impact.
As is often the case, when Bitcoin falls, everything else follows suit and Ethereum and XRP were also down by as much as 10%.
Oil prices were marginally higher with Brent approaching $70.00 to the upside and WTI around $66.00. However, the demand picture is still cloudy given the Covid situation in various regions. As Europe and the US begins to open up, many Asian countries are being faced with outbreaks that are leading to more social restrictions.
“The market is seemingly trapped between observing encouraging improvements in demand in the United States and Europe, and the sluggishness in consumption due to the persistence of COVID-19 in Asia,” said StoneX analyst Kevin Solomon.